insights (2007-13)

In the wake of TennCare's removal of 67,000 individuals classified as uninsurable from its rolls, Gov. Phil Bredesen last year initiated a limited step toward restoring health care coverage for individuals whose medical conditions prevent them from getting commercial health insurance.

On April 1, a program called
AccessTN will start offering them coverage in what's known as a "High Risk Pool." Premiums for those who can demonstrate they are otherwise uninsurable will be subsidized by the state, especially those with incomes of less than 200 percent of the federal poverty line ($20,000 for an individual).

Yet the $13 million that the state has allocated for low-income premium assistance would only permit coverage of 4,500 of these TennCare disenrollees, most of whom were very poor. In an effort to reach out to many more of them, the State Legislature appropriated an additional $25 million for this purpose and mandated that the Bredesen administration seek federal matching funds, à la TennCare, that would yield a total available for premium assistance to $88 million--believed to be enough to support some 30,000 of those who lost their TennCare coverage. But the administration has so far resisted this mandate on the grounds that it wants "a state plan that is not
governed by costly federal regulations" and "will not spiral out of control the way TennCare did." The $25 million has been held in abeyance "until we make a decision about whether/ when to apply for a [federal match]," says an AccessTN spokesperson, Emily Richard.

Bredesen's phobia where federal regulations and court orders governing TennCare are concerned would be subject to a lot more criticism if the resultant limitation on funding were precluding lots of uninsurable applicants from getting coverage. Yet as April 1 approaches, only 1,759 applications have been received for the 4,500 premium assistance slots in AccessTN. And it's not yet clear how many of them qualify.

So the question becomes why are so few people signing up for the program when so many would appear to be in need? A big part of the answer would appear to be AccessTN's affordability, or rather lack of same. For a 50-year-old who doesn't smoke and isn't overweight, the monthly premium is $162 for an individual with income less than $10,000 and $325 at $20,000. Both of these amounts (not to mention a $1,000 deductible) are well in excess of a widely used rule of thumb that most people can't afford to pay more than 10 percent of their incomes for health insurance.

When asked if the state considers these premiums to be affordable, Richard responds that, "The primary purpose of insurance programs for high-risk pools is to offer uninsurable individuals access to coverage. While affordability is a factor in any plan, it's not the consideration in this type of program."

Be that as it may, drawing on experience in other states, affordability alone doesn't begin to fully explain the lack of uptake. In New Mexico, for example, a premium assistance program makes coverage available to persons with incomes below 100 percent of federal poverty line for $75 a month and at 200 percent of FLP
for $110 a month with no deductible. Yet after two years of operation, only 5,000 of an estimated 174,000 eligible people have enrolled in this program that also incorporates group coverage for low-income workers of small employers similar to Bredesen's separately-packaged CoverTN program here.

The president of the New Mexico Hospital Association, Jeff Dye, attributes the lack of uptake there primarily to the need for "a better effort to publicize the program. The state hasn't done a very good job of outreach." (In partial contrast, Bredesen has been barnstorming across the state to promote participation in CoverTN with some apparent success, but other than a postcard to TennCare disenrollees little has been done to publicize AccessTN availability.)

Even with New Mexico's lower premiums, made possible by federal matching funds, officials there still believe that affordability remains a deterrent to participation by people with very low incomes. So much so, that Gov. Bill Richardson very recently got legislative approval to extend the state's Medicaid program to cover adults with incomes below 100 percent of FPL with no premiums or deductibles.

Beyond that, Richardson has appointed a 23-member task force to address ways to achieve universal health care in New Mexico and make recommendations prior to the 2008 session of the legislature. According to State Sen. Dede Feldman, who is on the task force, three models are under consideration: (1) Massachusetts' mandate that every individual in the
that state must have health insurance effective July 1 (with subsidies to help those with incomes below 300 percent of FLP acquire it); (2) a state coverage pool for all that would operate much like Medicare; and (3) a hybrid of public and private health plans.

Control freak that he is, Bredesen can be expected to resist any comprehensive address
to a health care solution for Tennessee's 600,000 uninsured adults. The governor may deserve credit for the ardor with which he's pushing his limited CoverTN plan that offers low cost, state-subsidized insurance to employers with no more than 25 workers, half of whom must make less than $41,000 a year. But CoverTN's benefits are so limited they wouldn't even meet Massachusetts' standards for "minimally credible coverage."

While touting CoverTN last week, Bredesen said, "It's not the be-all and end-all. It's not perfect. But it gets something in people's hands. I wanted to get something out there while we're all jabbering about what to do in the long run."

A number of states, however, are doing a lot more than jabbering. In California, Republican Gov. Arnold Schwarzenegger has thrown his considerable weight behind mandated coverage for that state's six million uninsured, and several other states are also following Massachusetts' lead. These initiatives and the formidable challenges that they face will have to be the subject of a separate column.